Mortgage Broker for Self-Employed Borrowers
Business owners, contractors, sole traders and company directors can borrow on the same terms as salaried buyers when the application reaches the right lender. As a mortgage broker for self-employed borrowers, we match how your income is earned and documented to lenders whose policy counts it fully.
What to Sort Before You Apply
Most self-employed applications are decided by the paperwork, not the business. Lenders assess the income shown on your lodged tax returns, so a strong year that has not been lodged yet usually does not count.
Timing your application around lodgement can change your borrowing figure. If your latest year is stronger than the one before, lodging it and obtaining the Notice of Assessment before applying often lifts the income a lender will use.
Check your ATO position. An outstanding tax debt, or a payment plan with the Australian Taxation Office, is visible to lenders and changes which ones will proceed. Some lenders will refinance a tax debt as part of the loan; others will not lend until it is cleared.
Keep business and personal spending in separate accounts. Clean bank statements make both full doc and alternative documentation applications faster to assess. As your Sydney mortgage broker, we review all of this before anything is lodged.
How Lenders Calculate Your Income
Two lenders can read the same tax returns and reach very different borrowing limits. The gap comes from five settings:
Which Year Counts
Some lenders use the lower of your last two years, some average them, and others will use the most recent year alone. When income has risen, that choice can move your borrowing power more than the interest rate does.
Add-Backs
Non-cash and one-off expenses can be added back to taxable income. Depreciation, interest on loans being refinanced, one-off costs and super contributions above the compulsory rate are common add-backs, though each lender accepts a different list.
Business Structure
Sole traders are assessed on personal returns. Company directors and trust beneficiaries are assessed on wages and distributions, and some lenders will also count retained company profit or undistributed trust income.
Income Trend
A sharp rise or fall between years draws closer review. A drop may need an accountant's explanation; a rise may be discounted until it is shown to be sustained.
Serviceability Buffer
The Australian Prudential Regulation Authority (APRA) requires banks to test repayments at 3 percentage points above the actual rate. That buffer applies to self-employed borrowers the same way it applies to everyone else.
Loan Options for Self-Employed Borrowers
The right option depends on how long you have traded and what documents you can provide:
Full Doc Loans
For borrowers with two years of lodged tax returns and Notices of Assessment. This opens the widest lender choice and the sharpest pricing, with higher LVRs available where lenders mortgage insurance applies.
Alternative Doc (Low Doc) Loans
Income is shown through business activity statements (BAS), business bank statements or an accountant's declaration instead of tax returns. LVRs are commonly capped around 80%, and pricing is usually higher.
Recently Self-Employed
Some lenders accept one year of financials, or less, where you have worked in the same industry before going out on your own. A tradesperson who moved from employee to contractor in the same trade is a common example.
Refinancing and Tax Debt
Moving to a lender that reads your income more favourably, or consolidating an ATO debt or business debts into the home loan where lender policy allows.
Investment and Commercial SMSF
Self-employed borrowers can also access investment property loans, equity release and commercial SMSF loans, including buying the premises your business operates from.
Who Self-Employed Lending Suits
Self-employed lending fits some positions better than others:
Borrowers It Suits
Sole traders, contractors, partners, company directors and trust beneficiaries with an active ABN, lodged returns or BAS, and business income that is steady or rising. It also suits business owners whose taxable income understates their cash flow once add-backs are counted.
Borrowers It Does Not Suit
Anyone with unlodged returns, an ABN under six months old with no prior industry history, or a falling income that only works at today's rate. Tax debt on arrears with no payment plan will also stop most applications.
Documents Lenders Ask For
Exact requirements vary by lender. Full doc applications usually need:
- Two years of personal and business tax returns
- The latest ATO Notices of Assessment
- Two years of business financial statements (profit and loss, balance sheet)
- Trust deed and distribution statements, where a trust is used
- ABN and GST registration details
Alternative doc applications usually need:
- An active ABN, commonly for at least 12 months
- Six to 12 months of BAS or business bank statements
- An accountant's letter or signed income declaration
How the Process Runs From First Call Onwards
The steps stay the same on every file, though timing shifts with lender queues and how fast financials come back:
Mapping Your Position
We review your returns, structure, add-backs and debts, then work out the income each lender type would use. Where your accountant can clarify a figure, we speak with them directly.
Comparing Lender Policy
We match your trading history and documentation against lender policy across our panel and bring back the options that fit, with rate, fees and maximum LVR for each.
Submitting Your Application
We prepare and lodge the application, present your income the way the chosen lender assesses it, and manage the lender's questions through to conditional and formal approval.
Coordinating Your Settlement
Loan documents are issued for signing, and we work with your conveyancer or solicitor to meet the settlement date in the contract.
Reviewing Your Loan
Once new returns are lodged, we check whether a stronger year opens up better pricing or a move from an alternative doc loan to a full doc loan.
None of this commits you to a lender, and no application is lodged until you have chosen one.
What This Costs You
Broker commission is paid by the lender that funds the loan. Any fee payable by you is set out in writing in our credit guide and credit proposal before you commit, and the first conversation carries no cost.
Full doc self-employed home loans are often priced the same as standard loans. Alternative doc loans usually carry a higher rate, and we show the comparison rate alongside any advertised rate so the full cost is visible.
Trade-Offs Worth Knowing
Costs and risks worth weighing before you commit:
Low Taxable Income
Minimising tax also minimises the income a lender can use. If you plan to borrow in the next year or two, discuss it with your accountant before the next return is lodged.
Alternative Doc Pricing
Low doc loans cost more and usually need a larger deposit. They work best as a bridge until full financials are available, followed by a refinance.
Business Debts Count
Equipment finance, business loans and director guarantees are all assessed against your income, even when the business makes the repayments.
Income Volatility
A quiet quarter still has to cover the repayment. Test your budget against a lower-income period and a higher rate, and keep a buffer in an offset account.
Why Business Owners Work With Us
DIY Lending operates as a Corporate Credit Representative of Finsure Finance & Insurance Pty Ltd, Australian Credit Licence 384704, and we are a member of the Mortgage and Finance Association of Australia and the Australian Financial Complaints Authority.
We hold access to more than 40 lenders, including banks and non-bank lenders with specialist self-employed policy. We check how each one reads your returns, add-backs and structure before an application goes in, so you are not declined on a rule that could have been identified on the first call.
Our self-employed mortgage broker work keeps every decision about your own money with you.
Know What Lenders Will Count
Send us your last two tax returns or your current BAS position, and you will get a borrowing range with the lenders that read your income most favourably.
Call 02 8806 7258 or send your details through.
Frequently Asked Questions (FAQs)
Can I get a home loan if I am self-employed?
Yes. Self-employed borrowers can access the same loans as salaried borrowers when they provide lodged tax returns. Where full financials are not available, alternative doc loans use BAS, bank statements or an accountant's declaration instead.
How long do I need to be self-employed to get a home loan?
Most lenders prefer two years of trading. Some accept one year of financials, and specialist lenders may consider less where you have prior experience in the same industry.
How do lenders calculate self-employed income?
Lenders start with taxable income from your lodged returns, then add back items such as depreciation and one-off expenses. Some use the lower of two years, some the average and some the latest year alone, which is why lender choice matters.
What is a low doc home loan?
A low doc loan verifies income through BAS, business bank statements or an accountant's declaration rather than tax returns. It usually needs a larger deposit and carries a higher rate than a full doc loan.
Can I get a home loan with an ATO debt?
Sometimes. Lenders look at the size of the debt and whether it is on a payment plan and up to date. Some will refinance the debt into the loan; others require it to be cleared first.
Do self-employed borrowers pay higher interest rates?
Not on full doc loans, which are usually priced the same as standard loans. Alternative doc loans generally carry a higher rate to reflect the lighter income verification.
How long does approval take for self-employed borrowers?
Most applications reach formal approval within two to four weeks from submission. Complex structures, such as trusts or multiple companies, generally take longer.
This page contains general information only. It does not take your objectives, financial situation or needs into account, and it is not a recommendation to enter into any credit contract. Figures, thresholds and lender requirements change, and the outcome for your situation depends on your circumstances and the lender assessing you. You may wish to speak with your accountant or a qualified professional before acting on anything here.